Overhaul on Horizon for Utilities Industry, Says J. D. Power
Predictions across the energy sector have been buzzing around as new technologies and techniques come into play. And that is no different when it comes to utilities.
J. D. Power, a global leader in consumer insights, advisory services and data and analytics, has released its latest report which sums up the state of the utilities sector and looks ahead to the future of utility service and delivery.
The Utilities Intelligence Report, published annually for the last two decades, analyses how utilities are headed for a referendum on price, reliability and sustainability in 2024.
Specifically, the report showcases how electric utilities may face a backlash due to pending and likely rate increases, how the uneven adoption of electric vehicles will separate utilities into laggards and those that leap ahead, how gas utilities will confront their own mortality amid rising prices, how utilities may become more zealous when it comes to the importance of their branding, and how some are finally embracing digital and may be pushed to do it even more.
For water utilities, J. D. Power prophecises, it will be a year of making good on the promise of ensuring clean water.
The Utilities Intelligence Report by J. D. Power
“Price continues to be a pain point for all customers,” said Mark Spalinger, Director of Utilities Intelligence at J.D. Power. “Electric and gas utilities will need to stay ahead of this with effective communications, energy efficiency and conservation assistance and billing support. Those utilities that effectively communicate well should be able to negate some of the impact on satisfaction due to higher bills and increasing rates.”
As highlighted by J. D. Power’s Director John Hazen, although this year’s iteration of the report unearths some new trends across the utilities sphere, some similarities and constants remain.
“There are some similarities but also differences,” he said. “Digital focus and EV focuses still exist and are a necessity for increased customer satisfaction. However, price focus shifts from rate plan adjustments and changes to supporting customers with conservation and efficiency initiatives, especially with customers still feeling financially uneasy. The big change is that overall satisfaction has declined year over year significantly.”
Both executives found that, in 2023’s report, despite there being no glaring surprises, there is some link to decluding satisfaction over the last 12 to18 months and the fact that the utilities industry is not fully embracing digital solutions.
“With 30% of the largest utilities not offering a mobile app or solution, there is a lot of progress to be made,” Spalinger stated. “As customer preferences are shifting to a digital future, utilities who embrace this will realise increased customer satisfaction.”
But how will the energy sector — as a whole and smaller working parts within it — move forward in light of the report’s findings? Price, communications, branding, and digital will all be important areas of focus going forward, the duo agree.
Hazen concluded: “Utilities that find success in the future will find success with proactive communications, increased branding, digital focus and sustainability. Every utility needs to increase their efforts to understand their customers better and to continue to improve customer experience.”
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